Dened

by Digital

High Performers in IT:

consulting |

Insights from Accentures fourth technology | outsourcing High Performance IT research

CONTENTS INTRODUCTION 1 INSIGHTS 01 It really is all about the customer 02 Context is the once and future king 03 IT strategy and business strategy are one and the same 04 Mastering a hybrid IT environment 05 Diving deeper into digital 06 Empowered employees are the force for digital business 3 7 07 Mastering data to drive outcomes creates competitive advantage 08 Adopting agile to become agile 09 Investing early in technology skills provides an edge 10 The marriage of IT security and business risk

23 27

9 11 15

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CONCLUSION 36 19 Prole of a High Performer How Accenture measures High Performance About the research report 38 39 40
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INTRODUCTION

High performers in IT are consolidating the noticeable lead that they have opened up in recent years. Not only are they nding novel ways to optimize holding down costs and streamlining processes across their organizationsbut they are also actively driving innovation and top-line growth. Increasingly, they are central to their organizations strategic directions and increasingly, those directions are dened by digital. Here are the highlights of Accentures fourth High Performance IT research, with the digital dimension clearly visible.

H I G h P er F O rm A nce IT re S e A rch

Take charge of your digital journey.

Thats probably what high-performing CIOs would tell their peers if they werent so busy propelling their own businesses toward the digital future. These high performers clearly see IT as a strategic asset that can help them renew vital aspects of their operationsoptimizing at least and innovating at best. They are investing in the digital tools, capabilities, and skills to more easily pinpoint useful data, evaluate it, excerpt it, analyze it, derive insights from it, share it, manage it, comment on it, report on it, and,

That gap persists today, as the high performers, more in tune with the business than ever, look to all things digital to upgrade a host of processes and to catapult their organizations forward. Increasingly, they are using digital tools and systems to push for excellence across all three dimensions of High Performance IT: IT innovation, IT agility, and IT execution. Heres how Verizon Wireless CIO, Shankar Arumugavelu, describes that push: Technology trends like mobile, cloud, social media, and big data have moved beyond the experimentation stage. Any business that uses these trends to drive market differentiation, growth, innovation, protability is what I consider a digital business.

most important, act on it. What a difference a decade can make. The digital direction seemed like such an impractical notion not long ago. In 2005 and 2006, Accentures High Performance IT research was describing the typical CIOs austerity trap, in which cutting costs only prolonged dependence on legacy systems. By the start of the global economic crisis, high performers had begun to take a strategic approach to cutting costs, breaking with their legacy roots. By 2009, there was a denite performance gap between the high-performing CIOs and the rest.

High performers are using digital tools and systems to push for excellence across all three dimensions of High Performance IT: IT innovation, IT agility, and IT execution.

This report captures the highlights of Accentures High Performance IT research and shows how a digital thread now runs throughout most of them. Lets consider the top ten ndings and describe what we mean.

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02

03

04

06

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INSIGHT 01

08
It really is all about the customer
High performers business objectives are very different from those of others. While most organizations continue to be internally focused on cost, productivity, and processes, high performers foremost objectives are related to improving the customers experience. Indeed, Accentures research found that the high performers top three business priorities related to ensuring that their IT investment strategies were linked to their customers. (See Figure 1.) They are concerned about providing the right information to the right personcustomer, partner, or employeeat the right time; they are seeking better ways to interact with their customers;

09
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HIGh PERFORMANCE IT RESEARCh

and they are keen to deliver new services or products to them. Further emphasizing the point: in organizations that werent high performers, these customer issues had a much lower priority. In 2008, our research revealed that, in terms of technical and business adequacy, customerfacing systems were among an organizations poorest-performing applications. Five years later, our research shows once again that the end customer is last in line outside the CIOs door at most organizations. (See Figure 2.) Moreover, the enterprises we surveyed told us that they actually spend slightly less on customer-related applications than they do on other applications. Yet high performers understand that customers of information, and exibility that they get from their personal technology. They ensure that customer-facing applications are meeting their business and technical needs. The digital direction is all too clear in leading companies relationships with customers. They understand that technology, which has created frustration and corroded relationships with customers, is now at the point at which buyers can again be treated as individuals. Todays technologies allow businesses to be more predictive around consumer preference and consumer behaviors, says Bill VanCuren, CIO of NCR Corp., the global consumer transaction technology company. They give the consumers more choice not just in what theyre buying but in the channels through which theyre transacting.

including consumers, business customers, and citizens, in the case of governmentare expecting the same, if not better, experience, speed, detail

1
FIGURE 1 High performers top three business objectives are related to customers

Ranking importance of business objectives to CIOs IT investment strategies

HIGH PERFORMERS OTHER ORGANIZATIONS

1 2 3 4 5 6 7 8 9

4 5 6 1 2 3 7 9 8

Providing the right information to the right person at the right time Finding better ways to interact with customers Delivering new services or products to customers Cutting business operational costs Increasing workforce productivity Automating core business processes Supporting our business innovation process Supporting geographic expansion Securing our intellectual capital and company information

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Companies now have rich channels through which they can communicate with customers in much more personal ways: not only do they now have unprecedented opportunities to track what people are saying about them, but they can also leverage digital technologies to create and sustain relationships that will result in customer acquisition and, for current customers, repeat sales. Commonwealth Bank of Australia understands this. The bank has transformed its IT approach with a focus on moving from product to relationship value. Every decision the bank has made in the course of modernizing its core banking platform has been driven by a focus on customer experience and real-time relationship value.1 Aside from digitals impact on how customers feel, it is also helping IT departments optimize business processes and cut costs. Our research found a considerable gap between the high performers and others in this regard: nearly one-third of high performers customer interactions are already completely self-service, with seamless interfaces across channels (for example, mobile, social media, and the Web); the comparable gure for other companies is only about one-fth, or 21 percent. The goal of the exemplars is to push this up to 56 percent as soon as possible. Other companies dont have such ambition: they expect to raise the bar only to 43 percent of customer interactions in the future.

FIGURE 2

Are your applications currently meeting your business and technical needs?
HIGH PERFORMERS OTHER ORGANIZATIONS

High performers front-office applications are among their portfolios best performing applications in terms of technical and business adequacyand the poorest for all other organizations
Meeting needs

5.0
Meeting needs

5.0
Meeting needs Industry Specic Human Resources Finance & Accounting Supply Chain Operations Customer Service Sales & Marketing

4.0
TECHNICAL NEEDS TECHNICAL NEEDS Meeting needs

4.0

3.0

3.0

2.0

2.0

1.0

1.0

2.0

3.0
BUSINESS NEEDS

4.0

5.0

1.0 1.0

2.0

3.0
BUSINESS NEEDS

4.0

5.0

HIGh PERFORMANCE IT RESEARCh

50
6

% of high performers explore future

economic, geopolitical, social, and business scenarios as part of IT creative processes.

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03

04

05

07

08
INSIGHT 02

09
Context is the once and future king
High performers do not view things in isolation. Exploring a wide range of business scenariosfor instance, economic, geopolitical, and socialis part and parcel of their IT planning processes. The latest High Performance IT research reveals that during IT planning, high performers enthusiasm for exploring business scenarios within the overall economic, geopolitical, and social context is ve times that of other organizations. (See Figure 3.)

10
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HIGh PERFORMANCE IT RESEARCh

That means that they actively listen to and understand their fellow executives issues from a business viewpoint; they dont see the world solely through IT glasses. They also make it their business to seek out wider perspectives, and they expect the same of their top lieutenants. This allows high performers to add a lot more value: they understand where the business is headed. High performers also track the impact of their investments on business metrics more often than do other organizations. And all high performers expect moderate to signicant improvement in those metrics in the next yearespecially in customer and employee satisfaction. Its clear that high-performing CIOs have mastered these business-savvy requirementsand it is interesting to note that they have been in their positions longer than the average CIO. They have had opportunities to see the results of their efforts, enhancing their own reputations within their organizations.

High performers dont see the world solely through IT glasses.

FIGURE 3 High performers explore business scenarios as part of their IT planning process

Today, our IT organization consistently explores future economic, geopolitical, social, and business scenarios as part of our IT planning or IT strategy creation processes

50% 10%
HIGH PERFORMERS OTHER ORGANIZATIONS

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03

04

05

08

09
INSIGHT 03

10
IT strategy and business strategy are one and the same
Accentures research conrms that high performers invest to deliver strategic business capabilities. Its far more likely that their organizations IT and business functions are in sync, so their investments typically reect the strategy and needs of the business, with the goal of creating differentiated businessdriven opportunities.

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A few snapshots: high performers allocate 7 percent more of their IT budget to new projects than do other organizations. Although their day-to-day IT operating expenses are expected to stay at this year, 54 percent of high performers will spend signicantly more on new projects. And over half of those IT investments (55 percent, compared with just 37 percent at other organizations) are designed to deliver strategic capabilities within the business. (See Figure 4.) Verizon Wireless amply demonstrates this collaborative provision of such strategic capabilities. You can see a good example of mobility at workwhere we partnered closely with our chief operating officers teamin how between the sales rep and our customers. Now, about 20,000 of our reps nationwide are equipped with tablets which feature the point-of-sale system. So now they can work side by side with customers. This really gets into consultative selling. That was a big win for us. It also helped us showcase the technologies that we sell; customers were really able to understand what can be done with a tablet. It led to additional sales for Internet devices as well.

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weve been transforming our retail stores, explains CIO Shankar Arumugavelu. Previously in our stores, we had the desktop or laptop

High performers arent waiting for new technologies to be developed or to mature before they act.

FIGURE 4 High performers invest to deliver strategic business capabilities

What proportion of your IT investments today is designed to deliver strategic capabilities within the business?

High performers, more and more in lockstep with other executives in their organizations, certainly see digital as a strategic imperativea tool of competitive intent. They arent waiting for new technologies to be developed or to mature before they act. They demonstrate a higher order of thinkinga digital mindsetthat will, we believe, separate tomorrows most able organizations from the rest.

55

37

HIGH PERFORMERS

OTHER ORGANIZATIONS

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05

09

10
INSIGHT 04

Mastering a hybrid IT environment

The results of Accentures High Performance IT research provide unequivocal proof that high performers are taking advantage of all that a new hybrid approachprivate and public clouds coexisting with existing systemshas to offer. Over the past few years, we have observed how high performers have been disentangling the legacy hairball and streamlining their application portfolios, essentially crafting a lean organization that can respond adroitly to the volatility of todays global markets.

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As illustrated in Figure 5, the high performers are now approaching new system architectures with a cloud rst mentalitythey are already migrating workloads to the cloud and looking at what can be achieved with the different forms of cloud, resulting in a hybrid cloud architecture. Hybrid cloud is not just a steppingstone; it is integral to the future state of IT organizations. The research shows that high performers will expand their cloud footprint faster than other organizations by migrating a larger proportion of their workloads to private clouds by 2015 and increasingly to the public cloud by 2020. They also expect that a substantial part of their IT footprintwhether infrastructure, middleware, or applicationswill remain traditional, both hosted and on-premise.

To high performers, hybrid cloud is not just a steppingstone; it is integral to the future state of IT organizations.

FIGURE 5

4b

High performers are further along in their transition to private and public clouds

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Regarding current and future initiatives for cloud computing, what proportion of your infrastructure, application development, and applications do you estimate will be distributed between traditional IT, pay-per-use but single-tenant IT, transitioned to private cloud, and transitioned to public cloud? Infrastructure
1% 31 11 57 10 % 40 10 40 19 % 36 10 35

Development
10 % 16 1 73 20 % 24 1 55 27 % 20 2 51

Applications
6% 9 1 84 13 % 24 1 62 18 % 22 1 59

HIGH PERFORMERS

HIGH PERFORMERS

NOW OTHER ORGANIZATIONS

2015

2020 OTHER ORGANIZATIONS

NOW

2015

2020 OTHER ORGANIZATIONS

HIGH PERFORMERS

NOW

2015

2020

1% 9 10 80

7% 23 16 54

14 % 33 15 38

1% 5 8 86

7% 15 13 65

12 % 24 14 50

3% 4 4 89

8% 11 11 70

14 % 20 12 54

NOW

2015

2020

NOW

2015

2020

NOW

2015

2020

Transitioned to IaaS Transitioned to private cloud Outsourced in a virtual private cloud Traditional IT, in house and outsourced

Transitioned to public PaaS Transitioned to private cloud-based dev Outsourced in a virtual private dev env Traditional IT, in house and outsourced

Transitioned to public SaaS Transitioned to private cloud application Hosted cloud application Traditional application license and maintenance

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Another way to look at this: one-third of high performers are evolving their architecture by replacing legacy components with private and public cloud alternatives. (See Figure 6.) Put simply, high performers are getting the outcomes they want from upgrading their enterprise architectures. In particular, almost half of high performers (40 percent versus 9 percent of other organizations) are seeing measurable improvements in IT agility, and 43 percent are experiencing better alignment of their project portfolios with their IT and business goals (compared with 20 percent of other organizations). Moreover, high performers are not taking their eyes off the cost implications: 33 percent say their architecture transformations successfully lead to cost reductions (versus 14 percent for others). A case in point: Deutsche Telekom opted for Googles platform-as-a-service offering, Google App Engine platform, as the basis for its Tripdiscover.de travel portal, which connects consumers with partners, social recommendations, and other high-quality content. Just 18 weeks after the Tripdiscover project launched, Deutsche Telekom had a fully deployed, exible, real-time scalable system intended to inspire and excite its users with a new type of online travel-booking experience.2
HIGH PERFORMERS

FIGURE 6

We are evolving our architecture by effectively replacing legacy architecture components with private and public cloud alternatives (Today compared with Target)

High performers are replacing their legacy architecture with a more exible architecture

58 33%

21% 4%
OTHER ORGANIZATIONS

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Yet the challenge now is to manage provisioning and integration between private and public clouds, coupled with a hosted and on-premise architecture in a secured and standardized way. It is further evident that the high performers have even been preparing their IT operations for this challenge and are ready to manage production workloads in the hybrid cloud: more than onequarter (27 percent) are now fully committed to using external cloud-based services that align with their business needs, and almost one in six (15 percent) already centrally manages a fully virtualized and dynamically provisioned infrastructure across multiple platforms. (See Figure 7.) If other organizations are behind in this endeavor today (only 1 percent are there), 40 percent intend to centrally manage a dynamically provisioned infrastructure in the futurebut will they catch up to the high performers lead?

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FIGURE 7 High performers are ready to provision and manage production workloads in the cloud

WeWe areare fully fully committed committed to using to using dynamically dynamically provisioned provisioned computing computing services; services; we we look look to leverage to leverage external external services services as needed, as needed, supported supported by by business business needs needs (Today (Today compared compared with with Target) Target)
% % 55 55 % % 27 27

WeWe centrally centrally manage manage a fully a fully virtualized, virtualized, unied unied environment environment across across multiple multiple platforms platforms and and dynamically dynamically provision provision infrastructure infrastructure services services (Today (Today compared compared
with with Target) Target)

% % 77 77 % % 40 40 % % 15 15

22 22 2% 2%

% %

1%1%

OTHER HIGH HIGH OTHER ORGANIZATIONS PERFORMERS PERFORMERS ORGANIZATIONS

OTHER HIGH HIGH OTHER ORGANIZATIONS PERFORMERS PERFORMERS ORGANIZATIONS

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05

10
INSIGHT 05

Diving deeper into digital

High performers are expediting their journey to digital, leading to a transformation in how goods are designed and produced, how commercial transactions are created and managed, how information is accessed, how relationships are formed, and how collaboration happens internally and with customers and partners. High performers have readily experimented with and learned from early deployments of social media, mobile, analytics, and cloud, as well as foundational technologies such as virtualization, security, and data management.

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Accentures research bears this out. (See Figure 8.) Now the high performers are ready to commit these technologies to a larger part of their organizationsand to harvest their transformational potential. Fully 69 percent of high performers (versus 42 percent of others) are already committing to mobile transactions, allowing their customers to reorder their favorite pair of shoes, book travel, pay for their coffee, and even transfer cash between bank accounts on the go. Fifty-four percent of the exemplars have also deployed a mobile-enterprise app store (versus only 22 percent of other organizations), providing enterprise-grade functionality to their mobile Forward-looking organizations are extending their social networks beyond people to intelligent objectssuch as their products. For example, the engines on Boeings new 787 Dreamliner aircraft are designed to transmit performance data in the form of news feeds to which maintenance High performers are also wading into social collaboration with the goals of capturing knowledge, fostering innovation, and boosting productivity. (See Figure 10.) They are taking greater advantage of their investments in collaboration technologies and are improving the way they access and leverage new insights from customers. For us, social collaboration is a godsend. For the rst time, were able to talk with our consumers instead of to them, declared one global CIO.

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users. (See Figure 9.)

5a
FIGURE 8 High performers are committing to digital technologies

Average adoption rates for digital-related technologies

Deployed/ deploying

In a pilot

In a proof of concept

Reading and monitoring

2
HIGH PERFORMERS OTHER ORGANIZATIONS

Doing nothing

1
Security Virtualization Cloud Architecture computing Information Business analytics Social collaboration Mobility

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estments

FIGURE 9

Percent Percent of organizations of organizations that that are are committing committing to mobile to mobile transactions transactions

Percent Percent of organizations of organizations that that are are committing committing to mobile to mobile enterprise enterprise apps apps stores stores

High performers are mobilizing their business

% % 69 69 % % 42 42

% % 54 54

% % 22 22

OTHER HIGH HIGH OTHER ORGANIZATIONS PERFORMERS PERFORMERS ORGANIZATIONS

HIGH HIGH OTHER OTHER PERFORMERS PERFORMERS ORGANIZATIONS ORGANIZATIONS

teams can subscribe. Allowing the engine itself to automatically share its status enables service teams to more easily maintain it, reducing costs and increasing its lifespan. Coupled with

predictive-analytics technology, the performance data helps optimize aircraft maintenance and ight operations, anticipating the need for parts replacement, for instance.

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5d

FIGURE 10

How would you rate the importance of the following objectives and your performance in achieving those objectives when leveraging collaboration technologies (interactive portals, social networking, video, instant messaging, SharePoint, wikis) in your organization?
My employees expect to be able to use a social network

High performers take signicantly greater advantage of their investment in collaborative technologies

5 4 3 2

PIONEERING Delivering services and after-sales support

Capturing and sharing knowledge

Improving employee productivity

BASIC

Increasing sales effectiveness through a larger network

Fostering innovation HIGH PERFORMERS - Performance OTHER ORGANIZATIONS - Performance Getting new insights from customers

Reducing the cost of doing business HIGH PERFORMERS - Importance OTHER ORGANIZATIONS - Importance

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71
18

% of high performers total

employee interactions are selfservice and seamless across channels.

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INSIGHT 06

Empowered employees are the force for digital business

Employees are increasingly mobile and teams of employees and freelance resources more often form on the ymaking work hours and locations completely irrelevant. And because they so depend on their technology portfolios to make it work, they often want to be able to choose their own devices and their own productivity applications that they must be able to access 24/7.

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The high performers in IT arent waiting around for trouble tickets from these employees. Accentures High Performance IT research shows that their employees are strongly empowered to handle most of their own day-to-day needsfrom concerns that are as basic as a password reset or as sophisticated as using the Web-based tools needed to crowd-source new product concepts. This mindset means that most high performers let their employees bring their own mobile phones and tablets to the workplace. They are well past the point where bring-your-own-device (BYOD) behaviors are seen chiey as threats to data security; rather, far-sighted CIOs view employees mobile tools as productivity multipliers, regardless of who bought the devices. What that means, Were not just a bunch of SQL programmers doing relational databases. The complex data analytics and big data problems come back to IT. The tool kit has become much more complex; its more diverse. We have a lot of ways to solve problems today that we did not have before.

Far-sighted CIOs view employees mobile tools as productivity multipliers, regardless of who bought the devices.

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explains Bill VanCuren, CIO of NCR Corp., is that only the really complex problems now come to IT. The same self-service concept extends to the high performers customers and suppliers. One example
FIGURE 11 High performers empower their employees to selfmanage over 70 percent of their interactions at work.
ARE NOW

is the Australian Taxation Office (ATO). It is looking Percentage of total interactions that are or could be completely self-service and via a seamless interface across channels
(for example, mobile, social networks, desktop, and video):

to provide services and tools that business owners can access on a tablet or smartphone so that they can manage their taxes on the go. ATO CIO Bill Gibson recently commented, When a tax agent is doing something, they are accessing the ATO to get data. You take that principle wider and the form factor doesnt matter.3

71 % 36% 29 % 21%
Customer interactions

31 %

24%

Employee interactions

Supplier interactions

84 %
COULD BE

61%

56 %

68 % 43% 49%

Employee interactions

Customer interactions

Supplier interactions OTHER ORGANIZATIONS

HIGH PERFORMERS

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Customers, partners, and employees have diverse desires, ambitions, and objectives when they interact with each other and with an organization. It is imperative for CIOs to anticipate and support those needs when turning offline interactions into digital interactions. With online, social and mobile customer interactions costing a fraction of what it costs to serve these individuals in person or over the phone, the potential benets of deploying these technologies are signicant. Yet Accentures research shows that, among both high performers and the rest, not even a third of customer and supplier interactions are self-service or seamless across channels. (See Figure 11.) This represents only a slight increase from 2010, when respondents reported that 26 percent of customer interactions were self-serviced online. Granted, organizations have had to adapt from siloed interactions (for instance, most online and mobile systems used different interfaces until recently) to omni-channel interactions with seamless interfaces. But the pressure for more self-service is very real: a new generation of digital buyers is expecting not only real-time, round-the-clock experiences, but also increasingly personalized services. The message for CIOs is clear.

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ACCESSING THE RIGHT DATA AT THE RIGHT TIME
A digital business is all about real-time business insights driving fast decisions and faster actions. These insights create the context for better digital customer experiences, enhanced workforce sidebar chapter 6 and supplier capabilities, and differentiated products and services. (Figure 12.)
FIGURE 12

Percentage of CIOs who say data that employees need to do their work is ... ... most accessible ... most granular ... real-time

High performers employees have better access to the detailed, real-time data that they need to do their jobs

OTHER OTHER OTHER HIGH HIGH HIGH PERFORMERS ORGANIZATIONS PERFORMERS ORGANIZATIONS PERFORMERS ORGANIZATIONS

Customer Products/services Suppliers/partners Employees

69 % 62 42 54

23 % 22 14 26

46 % 58 38 38

16 % 16 9 17

46 % 42 23 46

26 % 22 12 24

Percentage of respondents who answered 5 on a scale of 1 (not accessible) to 5 (most accessible)

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77
22 20

% of high performers data

management investments are achieving or exceeding business value.

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08

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INSIGHT 07

Mastering data to drive outcomes creates competitive advantage

The problem for businesses is no longer the absence of data. In a time when they are ooded with new data, the problem becomes the absence of the right data, which is what will produce the sharp insights that spur the most actionable outcomes. And those outcomes, in turn, create competitive advantage.

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High performers are far closer to the ideal of having the right data. They have been investing in master data management and data quality assurance for years. Today, the majority of high performers are fully committed to these information-management technologies. Their investments in data management and predictive and descriptive analytics are paying off: twice as many high performers as other organizations are achieving or exceeding the business value they expected. (See Figure 13.) For example, leading consumer-goods company Procter & Gamble realized that in order to move its business to a forward-looking view, it needed to invest in data Building on this strong foundation and understanding the dynamics between information and business processes and systems, high management technologies. It needed to achieve one version of the truth, enabling decision makers to focus their discussions not on the what but on the why and how.4

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High performers investments in data management and predictive and descriptive analytics are paying off.

FIGURE 13 Information management investments are paying off: twice as many high performers as other organizations are achieving or exceeding expected business value 30% 23% 28% 21% 19% 54 % 54 % 50 %

Our current information management investments are achieving or exceeding the expected business value
77 % 77 %

Data management

Content management HIGH PERFORMERS

Descriptive analytics

Predictive analytics

Mobile access to these technologies

OTHER ORGANIZATIONS

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performers are gaining the ability to embed analytics capabilities and feed customer insights into their processes. (See Figure 14.) However, even high performers have some way to go. Although most are leveraging a mix of internal and external data in their analytical capabilities, they admit that they still face signicant data-integration challenges. Whats the new frontier in data and analytics? When enterprises dont have access to the right data, they need to start looking differently at how they go about getting data. They cant rely solely on the limited universe of data they already have. The challenge will be to gure out not only how to collect data but, in many cases, how to create it. Accenture contends that whereas the current generation of software was designed for functionality, the next generation must be designed for analytics as well.

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FIGURE 14

Our organization has realized the following benets from integrating its business processes, information, and IT systems to a very large extent
62 % 46 % 46 % 38 %

High performers are building strategic analytical capabilities

7%
Improve the organizations ability to analyze the costs and benets of business processes

2%
Embed real-time, analytics-based decision-making tools into business processes

3%
Develop and capitalize on new insights on changing customer behavior OTHER ORGANIZATIONS

6%
Provide access to key information from across a variety of devices

HIGH PERFORMERS

HIGh PERFORMANCE IT RESEARCh

46
26

% of high performers expect to

adopt agile methods across their organization.

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09

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INSIGHT 08

Adopting agile to become agile

A key reason why high performers are eager to extricate themselves from their legacy systems is that they aim to open up many more degrees of freedom for their organizations. In other words, they are assiduously developing agile systems and operations that enable their organizations to adapt far more quickly.

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FIGURe 15 One in ve high performers has adopted agile methods across its organization 18 % 55 9 18 46 % 36 0 18 3% 48 28 21 29 % 50 14 7

To what extent has your organization adopted agile methods as an approach to delivering applications?
(Today compared with Target)

In essence, the high-performing teams are using agile methods to build simple, elegant, and exible architectures that make it much easier to experiment with new technologies, respond to changes without the need to shut down systems, and add functionality as required. Agile methods also mean making incremental technological changes and quickly learning from them, rather

HIGH PERFORMERS

OTHER ORGANIZATIONS

than committing time and resources to massive monolithic rollouts.

We have adopted agile across our organization We have used or are using agile on a few select projects We are reading and evaluating We do not use agile

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Accentures research nds that one in ve high performers has adopted agile methods across the organizationthats six times what others do. (See Figure 15.) The benets? Their companies can respond far faster to changes in their business, sensing and dodging problems and jumping more nimbly onto opportunities.

High-performing teams are using agile methods to build simple, elegant, and exible architectures.

In addition to building an agile architecture, high performers are remodeling their portfolios of applications to respond to volatilitynot only to deal with increased market disruption and uncertainty, but also to handle more interactions with partner organizations and to handle faster changes to business models. Compared with other respondents, high performers have been

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FIGURE 16

We have one global or regional instance; updates are monitored globally

69 % 60 % 55 % 64 % 58 %

Compared with other organizations, high performers are more disciplined in reducing the applications count

37% 29 % 18% 14% 36% 25%

in their portfolios

21%

Sales and marketing

Customer service

Finance and administration HIGH PERFORMERS

Human resources

Distribution and supply chain

Operations and production

OTHER ORGANIZATIONS

better able to combat complexity because they have successfully reduced the numbers of applications in their portfolioswhile modernizing those portfolios. (See Figure 16.) For example, 60 percent of high performers report that they already have one global or regional instance of their sales and marketing applications compared with 18 percent of other organizations. Moreover, 60 percent of high performers told

us they have recently upgraded their sales and marketing applications, compared with 26 percent of other organizations. This rationalized and modernized portfolio of applications gives high performers the exibility to respond to business change more swiftly.

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HIGh PERFORMANCE IT RESEARCh

85
30

% of high performers identify

skills in new technologies as one of the top skills to have for future success.

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09

10

INSIGHT 09

Investing early in technology skills provides an edge

Accentures research nds that the high performers identify, early on, the internal and external skills they need. Because they are avid experimenters, they can quickly spot where there are gaps in capabilities and skills. They have an especially keen eye for skills in new technologies, with 85 percent of high performers telling us skills in new technologies are some of the top skills to have for future success. (See Figure 17.) One-third of high performers have already addressed this gap (versus only 3 percent of other organizations) and another 44 percent are busy recruiting and training in those skills today (versus 30 percent of other organizations).

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9aR

FIGURE 17 High performers identify, early on, the internal and external skills they need

Top ve skills CIOs will need to be successful as their sourcing and operating models evolve toward a standardized and simplied architecture:
85 % 61% 69 % 72% 62 % 63% 66% 54 % 54 % 53%

New technologies knowledge and skills

Business knowledge and relationship skills HIGH PERFORMERS

Service integration skills

Enterprise architecture and Information management skills

Requirement analysis skills

OTHER ORGANIZATIONS

Its incumbent on IT to be early adopters of the technologies, says NCR CIO Bill VanCuren. So the rst challenge is to get your own IT organization on board with change. Yes, you have to balance

Business knowledge and soft skills are also at the top of the list for most high performers. Their CIOs recognize how critical it is for IT leaders at many levels to be able to communicate effectively with their business colleagues. The Accenture research reveals that leading CIOs are very conscious of the talents available beyond their own organizations. They think in terms of a talent network across partners, outsourcing rms, and consultants. One in ve high performers has a comprehensive sourcing strategy, aligning key partners with business prioritiesand doing so three times more than other organizations. (See Figure 18.) Its a different mindset, of course, to think about tapping into skills beyond full-time staffers, but its crucial in a world in which requirements change quickly, and agility is key. And, its a different type of talent that is needed in the digital world. There is a need for professionals who are comfortable with uidity and change.

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your current set of IT offerings with the next wave of technologies that youre exploring, but meeting the challenge starts with the IT organizations ability to take risk and learn new things and then be the change agent for the company.
FIGURE 18 High performers are conscious of the talents available beyond their own organizations

We have a comprehensive sourcing strategy; strategic vendors are aligned to business requirements and priorities
(Today compared with Target)

50% 32 18
% %

HIGH PERFORMERS

OTHER ORGANIZATIONS

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10

INSIGHT 10

The marriage of IT security and business risk

Despite an increasing focus on securing the growing digital business, IT departments struggle to keep pace with recent advances in security technologies. Although respondents from most organizations believe they currently have the right level of investment in compliance and overall security, 45 percent concede they have been underinvesting in cybersecurity. There is a general understanding that endpoint security is not enough, but the move to active defense staying one step ahead of the attackersisnt yet happening on a broad scale.

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HIGh PERFORMANCE IT RESEARCh

Although security technologies are maturing rapidly and communities are forming to expose risks, the biggest problem is slow adoption of solutions that already exist. ITs core challenge: get current with best practices in security while getting smarter about the new activedefense possibilities. Security is assuredly an area in which the high performers far outpace other organizations in terms of priority. High performers put signicantly more emphasis on the ability to anticipate cyber threats and on clarifying the security governance
FIGURE 19 High performers view improving their ability to anticipate cyber threats and their approach to business continuity security priorities

give high priority to dening an overall security strategy, improving their approach to business continuity, dening a risk-based approach to security, and shoring up their security controls associated with mobility. With improving the ability to anticipate cyber threats as a top priority, high performers are

model and organization structure than do other IT organizations. They are also twice as likely to

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In the high performers mind, there is no point at which IT security ends and business risk begins; high performers see the two blending together seamlessly.

10a as their highest

Please describe the security priorities for your organization:

62 % x2 62 % x3 40% 24% 18% 28% 15% 23% 62 % 62 % x2 54 % x3 54 % x2 46 % 46 % x2 26% 38 % 23%

HIGH PRIORITY

20%

Improve our approach to business continuity

Improve our ability to anticipate cyber threats

Minimize or prevent system downtime

Dene an overall security strategy

HIGH PERFORMERS OTHER ORGANIZATIONS

Clarify the security governance model and organization structure

Implement or improve security controls associated with mobility

Improve information and data protection controls

Baseline the organizations risk prole; dene a risk-based approach to security

Improve our identity management capability

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10b
further along in responding to that challenge and indeed, in developing more effective, more holistic security policies in general. Their CIOs are acutely aware of the need to protect their organizations intellectual property, product innovation, and processes. (See Figure 19.) More than a quarter of the high performers are expanding the scope of their security and risk management functions to include intellectual property, product innovation, and processesdoing so three times more than other organizations, according to Accentures research. (See Figure 20.) In the high performers mind, there is no point at which IT security ends and business risk begins; high performers see the two blending together seamlessly. Eight out of ten already track their organizations operational risks stemming from IT investmentsnotably those in digital technologies. Their goal is to keep risks in check; 75 percent of high performers aim to continue to lower their risk proles in the short term. To that end, almost half of their security organizations work hand in glove with the lines of business four times more than other organizations. And more than one-third of high performers measure the value of security and track specic outcomes of incidents and breaches, attributing business value to security. Only 5 percent of other organizations are doing that today.
HIGH PERFORMERS

6c
FIGURE 20

The security and risk management function is moving outside the boundaries of traditional IT to protect intellectual property, product innovation and unique processes (Today compared with Target)

High performers protect their IP, product innovation, and processes

Are your ap
5.0

Meeting

4.0

35% 8%
OTHER ORGANIZATIONS

TECHNICAL NEEDS

50% 27%

3.0

2.0

1.0

1.0

Scale of 1 to 5, 1 = not me

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HIGh PERFORMANCE IT RESEARCh

CONCLUSION

36

In previous rounds of Accentures High Performance IT research, we discussed how little change there has been across the IT disciplines. Although the high performers have been operating consistently at levels far and above the rest, overall there have been very few step changesthat is, few pronounced differences from one round of research to the next. However, this fourth round of the research reveals some stark distinctions. Not only is the gap between the high performers and the rest as wide as ever, but high performers now have the tools and know-how digital tools and digital know-howto race far ahead of the rest.

ACCENTURE

the CIOs relationship with the rest of the C-suite is vitally important for their success; and, as technology becomes more central to businesses, This raises many provocative questions: Will the high performers already on the digital journey be the leaders of business and industry if they do it right? What will happen to the organizations that are distinctly far behind? And what will happen to the IT function itself as business and IT converge in the digital world? Will the high in high performance be redened once again? One thing we do know is that over the course of the four rounds of Accentures High Performance IT research, there are three trends that continue unchanged: across the board, the gap between high performers and the rest remains wide; the IT and business agenda becomes one and the same. This is something for CIOs to think about as they look at their organizations in the future. And its a challenge for Accenture as we embark on the next round of research.

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HIGh PERFORMANCE IT RESEARCh

ProfiLe of a high performer

Three building blocks provide a guide for CIOs

IT Execution
n

IT Agility
n

Considers a strong and mature enterprise Proactively retires legacy systems and

architecture to be a critical IT requirement

n

achieves higher levels of end-to-end systems interoperability and availability

n

 Provides access to the right management tools and information for proactively tracking the performance of IT in the organization to sustain continuous improvement  Measures the impact of enterprise architecture projects Has comprehensive data-management policies

Integrates the portfolio of applications

internally and externally to optimize the automation of processes

n

Manages systems that are responsive to

changing business-information needs and shares data as services across the infrastructure

and procedures to enforce data standards

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and security
n

Proactively measures and monitors

IT Innovation
n

performance of applications and replaces some to drive greater returns

n

Leads the market in adoption of Positions the IT organization to play a critical

innovative technologies
n

Prioritizes investments in applications on

the basis of users needs for business process improvement

n

role in the innovation process of the organization and uses IT to craft business strategies and create new business opportunities
n

Understands the value of being able to track

benets of infrastructure investments at all times and efficiently manages the costs and benets of their infrastructure services
n

Works closely with business users to optimize Creates policies that support internal- and Provides real-time decision-making tools

functionality and lower operational costs

n

Enforces comprehensive security-governance

policies and standards that are tied to risk management functions and has secured end-to-end information processes

external-asset reuse
n

that allow employees to access and analyze information

n

Follows a centralized risk-management

approach and always designs business processes with security and data privacy in mind

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ENDNOTES
 Interview with Michael Harte, CIO, Commonwealth Bank of Australia, CIO, August 2, 2013. Deutsche Telekom: Creating a Customer  Portal Using PaaS, Accenture, 2013. ATO, Defence Talk BYOD, CIO, July 24, 2013.   Data Analytics Allows P&G to Turn on a Dime, CIO Insight, May 3, 2013.

HoW AccentUre MeasUres High Performance

Accentures High Performance IT research is a global effort that measures organizations IT capabilities as an indicator of high performance. Using the score, we then calculate a mean To identify high performers, we begin with a core set of more than 68 performance indicators in 37 questions that address prerequisites for IT leadership in each building block. To ensure that the appropriate indicators are used, we employ reliability scores (using results that are consistent). We then use the questions to calculate each participants performance score for each of the three building blocks. High performers are those that are leaders in all three building blocks. For this fourth global High Performance IT research, we identied 13 high performers among the 202 respondents. of the resulting performance scores for each building block. Next, we identify the leaders in each building block by selecting the participants with scores that were higher than one standard deviation from the mean result (approximately the top 15th percentile).

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HIGh PERFORMANCE IT RESEARCh

ABOUT THE RESEARCH REPORT

The High Performance IT research has been operating since 2005, and to date has involved in-depth participation by more than 1,700 CIOs across 45 countries. Assessments were conducted by the most senior IT executives in 202 of the worlds largest private and public sector organizations. The respondents represent a wide range of industries and geographies: 45 percent were from Europe, 19 percent from North America, 20 percent from Asia Pacic, and 15 percent from Latin America. The companies have combined annual revenues of over $2.4 trillion and include both Accenture clients and non-clients. For the survey, Accenture used more than 150 proprietary indicators of high performance in managing IT, across eight IT capabilities. Many of these questions were created to shed light on the differences between CIO assessments of how their IT is performing today and where they aspire it to perform in the future. In the 150 areas of IT management, respondents were asked to rate their IT practice on a scale ranging from Ad Hoc or Not Managed (1) through Dened and Managed (3) to High Performing (5). The denitions of Ad Hoc or Not Managed, Dened and Managed, and High Performing were based on Accentures appraisal of industry consensus on the given topic.

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ACCENTURE

# D I G I T A L IT

For more information about the High Performance IT research, contact Paul Daugherty, paul.r.daugherty@accenture.com or visit www.accenture.com/highperformanceit.

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Copyright 2013 Accenture All rights reserved. Accenture, its logo, and High performance. Delivered. are trademarks of Accenture. This document makes descriptive reference to trademarks that may be owned by others. The use of such trademarks herein is not an assertion of ownership of such trademarks by Accenture and is not intended to represent or imply the existence of an association between Accenture and the lawful owners of such trademarks.